The Folly Of rewarding A, While Hoping for B Case Study
Overview:
In this case analysis we shall be examining the unintended contradictory results that reward systems bring about and recommendations in solving the issues highlighted

Problem Statement:Many Problems in Organizations are created because of Faulty Incentives and Flawed reward systems that are setup to accomplish one thing but actually does the opposite. “While Mangers complain about lack of motivation in their workers, they might as well consider the possibility that the reward systems they’ve installed are paying off for the opposite”. Directly linked to these Faulty Incentive and Flawed Systems are key issues with 1) Employee Motivation, 2) Reward Systems, 3) Expectation/Misaligned Perception and 4) Biasness in Decision making that are deeply rooted as a causative agent in the Flawed system

Hypothesis

1)Misaligned Perception/Expectation:

Process Perspective: A look at Equity theory and Expectancy Theory in understanding the expected outcome perceived by employee as related to behavioral attitude towards rewards systems

2)Employee Motivation which is dependent on the effectiveness of its reward system: As pointed out by MASLOW HIERACHY OF NEEDS and HERZBERG’S TWO-FACTOR theory of Motivation highlight the effect of rewards both tangible and intangible on behavior 3) Weak or Poor decision Making: As shown by biasness of the community in electing Public service official, even in the face of the right option for endorsement/election 4) Poor performance and attitudes In Most Companies is caused by its reward systems, not the workforce.

Analysis:

As Pointed out by Expectancy theory that People make choices about behavior based on their expectation of what is likely to happen in terms of effort leading to performance and performance leading to desired reward. On the other hand Equity Theory Points out that those Perceptions about reward systems matter. From Equity Theory, if the Ratio of someone’s outcome/input is equal to someone else’s ratio, equity exists. But if not, inequity exists and the theory suggests that People are motivated to reduce their Contribution in some way According to Equity theory, outcomes from a Job include pay, recognition, promotions, social relationships and intrinsic rewards. To get these rewards, the individual makes inputs to the job such as time, effort, experience e.t.c and compares it to someone else’s ratio of contribution. Thus the Individual behavior is affected by his or her Perception than the actual reality. In Sports, An underpaid Basketballer will be discouraged in developing teamwork skill. in order to make up for any inadequacies, Expecting that Scoring will Increase his or her earnings at the detriment of the team success. Similarly, if this player perceives that future rewards might be compromised; such player will reduce his or her commitment in response to his feeling of inequity towards the Team success. Thus it is discovered that people take into account Equity and expectation about future rewards in their choice of behavior.

Taking a look further points out that Many rewards systems discourage desired behaviors’ while rewarding the very action that causes problems. Managers obviously design reward systems to motivate people to behave in certain ways, yet reward systems do not always produce the expected results. For example: In World War II troops were committed for the duration unless killed or invalided. They had a strong motivation to hasten the end of the war. Allied troops in the Vietnam War had a tour of a year or less. Their self interest was not tied to the end of the war. While their governments wanted them to focus on winning the war, their rewards were linked to looking after themselves. Not to their opponents. They were there for the duration.

Evidence of a Reward System which encourages Contrary behavior can also be traced to the Health Industry .Looking at...

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...On the Folly of Rewarding A, WhileHoping for B
Author(s): Steven Kerr
Source: The Academy of Management Journal, Vol. 18, No. 4 (Dec., 1975), pp. 769-783
Published by: Academy of Management
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On
the
of
Folly
A,
RewardingWhile
Hopig
for
B
STEVEN KERR
Ohio StateUniversity
Illustrations are presented from society in general, and
from organizations in particular, of reward systems that
"pay off" for one behavior even though the rewarder
hopes dearly for another. Portions of the reward systems
of a...

...Kerr’s observation on “The folly of rewarding A whilehoping for B is true today, simply illustrates the sometimes fouled up rewards systems that most companies have in place. Fouled up in the sense that most companies wrongly reward not so positive behaviours whilehoping and expecting for better ones.
Kushell, E., Michael A, Heide D and Bosserman N, in their article explain that “Kerr’s words help explain today’s disappointing competitive results.” They further explain that most organisations continue to reward less productive behaviour, using the example of getting a job done being more important that how the job gets done at the expense of long term gains in productivity.
In his article, “The folly of rewarding A whilehoping for B” (1995), Steven Kerr explains how this proposition often occurs in businesses and cites the example of an insurance company that awarded their employees based on their performance. Those who performed to an outstanding level were awarded 5% of the company’s profit share. Those who performed satisfactorily were awarded 4% and those whose performance was found wanting were awarded 3%. However, the company had a low tolerant policy to absenteeism and any employee who was absent or late for three or more times in a 6 months period would not be entitled to any percentage of the...

...The Brain’s Rewarding System & Addiction
Biopsychology
Abstract
The purpose of this paper is to examine the article, “The Brain’s Rewarding System & Addiction” (2004) by Katharine P. Bailey, MSN. In this article, I did not find a general hypothesis. Studies in this article show that most drugs directly or indirectly cause selective elevation of dopamine levels in the nucleus accumbens (NA), the ventral tegmental area (VTA), and the limbic system, consequently called the reward center of the brain (Bailey, 2004). Behaviors that bring pleasure and are also crucial to existence (eating, drinking, and sex) also activate the same reward circuitry, however, activation of this circuitry by addictive drugs can be much more powerful than activation triggered by natural rein-forcers (Bailey, 2004). One method of research used animals in a classic self-stimulation experiment where an animal pushes a lever to receive award. Future directions for the author would be to implement the use of human studies instead of mentioning only animals.
Introduction
The purpose of this paper is to examine the article, “The Brain’s Rewarding System & Addiction” (2004) by Katharine P. Bailey, MSN. In this article, I did not find a general hypothesis. The author refers to the different characteristics of addiction within each section, and explains some of the behavioral, genetic and neurochemical causes and the...

...Using rewards to motivate
employees.
How to pay: rewarding individual
employees to variable pay programs
Types of pay programs








Piece-rate pay
Merit based pay
Bonuses
Skill based pay
Profit sharing plans
Gain sharing
Employee stock ownership plans
Evaluation of variable pay
Piece rate pay



Provides no base salary and pays the
employees only for what the one
produces.
E.g. ball park workers
Limitations are that they are not
feasible for many jobs
Profit sharing plans



This plan distributes compensation
based on some established formula
designed around the company's
profitability.
e.g. Particularly for top managers
Positive impacts:
on employee attitude
feeling of psychological honourship
Merit based pay plan



Pays for individual performance based
on performance appraisal ratings.
E.g. IBM
Advantage:
people thought to be high
performers can get bigger rewards.
Evaluation of variable pay



Do variable pay programs increase
motivation and productivity?
Gainsharing has been found to increase
productivity and has a positive impact
on employee attitudes
Workers responds to prices
bonuses



An annual bonus is a significant
component of total compensation for
many jobs.
When times are bad firms can cut
bonuses to reduce compensation cost.
E.g. Steel company nucer.
Skill based pay



It is an alternative to job based pay
that bases pay levels on how many
skills employees have.
It is also facilitating...

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3
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...Manet’s Olympia – the ‘female gorilla’ as she was called in 1865, illuminated the Jeu de Pume museum with her erotic beauty. The impact of ugliness in the new art displaced the cult of female beauty, marking the inscription of the terrible caesura the second world war: massacre overwhelming mascaraed: ‘Ugliness, as an inscription of time in the heart of a picture, asserts itself doubtlessly as a “surface”, eroded, withered, used up, not to say flayed’. In painting reality as Manet sees it, he challenges the accepted function of art in France, which is to glorify history and the French state, and creates what some consider the first modern painting. His model, Victorine Meurent, is depicted as a courtesan, a woman whose body is a commodity. While middle-and-upper class gentlemen of the time may frequent courtesans and prostitutes, they do not want to be confronted with one in a painting gallery. A real woman, flaws and all, with an independent spirit, stared out from the canvas, confronting the viewer, something French society in 1865 is perhaps not ready to face.
Similar to Manet, Judy Chicago also challenges the accepted function of art and the depiction of the female figure. The Dinner Party is an installation artwork, a “ceremonial banquet honouring a total of 1,038 women”. The banquet table is arranged on a triangular table with a total of thirty-nine place settings, each commemorating an important woman from history. The settings consist of embroidered...

...﻿CHAPTER 10 - MOTIVATING AND REWARDING EMPLOYEES
LEARNING OUTCOMES
After reading this chapter, students should be able to:
1. Define and explain motivation.
2. Compare and contrast early theories of motivation.
3. Compare and contrast contemporary theories of motivation.
4. Discuss current issues in motivating employees.
5.
Opening Vignette – Best Practices at Best Buy
SUMMARY
Do traditional workplaces reward long hours instead of efficient hours? Wouldn’t it make more sense to have a workplace in which “people can do whatever they want, whenever they want, as long as the work gets done?” Well, that’s the approach that Best Buy is taking.1 And this radical workplace experiment, which obviously has many implications for employee motivation, has been an interesting and enlightening journey for the company.
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...Interesting article especially as rewarding and motivation was a topic close to my heart during my HR years. My understanding o the article is that to achieve the desired business objectives and high productivity, or to influence certain behaviors in the workplace such as teamwork and professionalism an adequate rewarding system must be in place. Although financial reward is the first thing that comes to mind when we think of rewarding employees, it is not the only type and in some cases may not be the best one to use. Furthermore, if it is not carefully designed it can trigger undesirable outcomes. It is worth pointing out that the definition of rewarding is different from one person to another and from one culture to another. Therefore, it is crucial for multinational organizations to appreciate the differences between cultures and design their motivation tools to accommodate them.
From an individual perspective:
I believe that we have been trained to look for rewards and be inspired by them since childhood. For example, many of us have heard parents saying to their children “if you behave, I will give you a chocolate bar”. So it is normal to look for the reward in every deed whether in our business or personal life. In addition to the sense of self-satisfaction that recognition normally brings, it also has plays a strong role in encouraging and motivating staff to deliver more. It is an addictive type of...